Choosing Between Revenue From Members and Donors
OK, now we are wading into touchy territory—a discussion on the relative value of members vs. donors in a nonprofit.
The reason this topic is so interesting to me is because I see so many nonprofits choosing between them, separating them into little fiefdoms, thinking about them as unrelated functions and, generally, not having a holistic view of the whole thing.
Take a very large charity that has a huge recreational facility. Its sources of revenue drop into four large categories: donations, member fees, facility rental and grants.
Forget about facility rental and grants, for the sake of developing these thoughts, and focus on donations and member fees. This is where it gets interesting.
This agency hires two people:
- A director of membership services who is solely responsible for getting, keeping and satisfying members.
- A development director who is solely responsible to get, keep and satisfy donors so funds will be raised to run the place. Major gifts is usually buried in this system.
I have found that the membership person hardly knows anything about fundraising, and if he does he really doesn't (really, really) care about it. And the development person, while giving some lip service to the need to get members, doesn't really care about those metrics, goals or needs.
So we have these two silos where a great deal of opportunity and revenue are lost.
I know for a fact that buried in the donor file are hundreds of potential members. And hidden away in the member roster are some really good donors. In fact, in one file, where we were able to do the analysis we do, we found some really high-value major donors who were busy giving their money to other charities because this one, apparently, didn't need any! Whew. Makes me sweat!
If you’re hanging with Richard it won’t be long before you’ll be laughing.
He always finds something funny in everything. But when the conversation is about people, their money and giving, you’ll find a deeply caring counselor who helps donors fulfill their passions and interests. Richard believes that successful major-gift fundraising is not fundamentally about securing revenue for good causes. Instead it is about helping donors express who they are through their giving. The Connections blog will provide practical information on how to do this successfully. Richard has more than 30 years of nonprofit leadership and fundraising experience, and is founding partner of the Veritus Group.